Going Green: How to Save Energy and Cut Retail Business Expenses

That’s huge, especially considering small businesses spend more than $60 billion a year on energy — meaning the retail industry is responsible for a third of those energy costs. In fact, retail buildings incur more energy-related costs than any other commercial sector in America. And those stats alone are enough to make retailers consider how to save energy.

But going green isn’t just about cutting energy costs. There are other ways you can be a more environmentally friendly retailer, including things like going paperless and bagless. Below, we outline some ways you can get started going and earning green while learning how to save energy.

How to Save Energy: A Retailer’s Checklist

Figure Out Where You Stand

Before you can set goals to go greener, you have to establish a baseline. Many energy companies will perform energy audits for free, so contact your utility company to find out more details.

Get Reimbursed for Your Efforts

Learning how to save energy has more benefits than you might expect. Going green is great for both the environment and your bottom line, potentially saving thousands of dollars annually. But beyond the savings, being eco-friendly can also earn you money — in the form of tax incentives.

These incentives are often available both on a federal and state level, and sometimes even on a local level. For more information, check out these resources to help you decipher which credits are applicable to your situation:

Look at Your Lighting

One of the most well-known ways of reducing costs and increasing energy efficiency is to give your lighting an upgrade.

Energy efficient lighting can make a huge change in your electricity costs. Look for compact fluorescent lamps (CFLs) and light-emitting diodes (LEDs). LED lights last longer than traditional bulbs, so you get a better bang for your buck. T8 fluorescent lights are a great option for showcasing products — they save energy, illuminate well, and minimize glare.

If you go solar, you could save even more. One entrepreneur cut emissions by 65% and electricity bills by 40%, largely thanks to his business’s move to solar-powered electricity.

If your space allows for it, get as much natural lighting as possible. Add windows and skylights, and make sure windows are unobstructed by signage outside.

Always prioritize areas in your store where customers and products will frequently be located or pass through. While it’s important for all areas to be well-lit, those make the biggest impact on sales.

Inspire Your Employees to Join

Your employees are assets who can help you reach your green goals. Without their support, you’ll have a tougher time making the transition.

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Educate them on your plan and why you’re passionate about it, and encourage them to share their own ideas as well. They might think of things you never would’ve considered on your own.

Host a training session that explains the measures you’re implementing, and instruct them on how to save energy during their own shifts. Each employee plays a part in your energy-saving goal.

How to Cut Utility Costs Across the Board

Much like lighting, examining your utilities more closely will reveal many opportunities to be greener and save money.

The first steps you can take are to make sure windows and doors are properly sealed when closed. You could consider installing double-pane windows to help with insulation as well. Heating accounts for 40% of energy used in retail locations, so any steps you take to reduce those costs could make a noticeable impact on your bottom line.

Blackout curtains can eliminate the heat of the sun in warm areas of your store. Just make sure you don’t sacrifice lighting completely, as the customer experience comes first.

Programmable thermostats will allow you to schedule your heat or air conditioner to go to predetermined temperatures. Make sure the temperature is comfortable during operating hours, and then ease up when your shop is closed. You could save up to 15% on heating and cooling by changing the temperature by 10 to 15 degrees when no one is in the store.

A more out-of-the-norm example of a retailer aiming to reduce air conditioning costs is Walmart. Some stores have painted the roofs white, reflecting light from sun, which in turn reduces the need for air conditioning.

Purchase the Right Appliances

Water-efficient toilets and sinks can reduce your water consumption, and ENERGY STAR appliances can have major effects on your utility costs (not to mention, some are also eligible for those tax deductions we mentioned).

Replacing an older toilet with a newer, water-efficient one can lower water usage by up to 60%. To reduce consumption even further than water-efficient toilets, consider composting toilets. These are still rare to see in retail settings, so it depends how committed you are to the mission and on your target customers.

For retailers, it’s difficult to allow staff to work from home, especially when it comes to the sales associates. They need to be physically present on the floor to help create the full shopping experience for your customers.

Make it easy for your sales associates to get to work in an environmentally friendly way. Offer bus passes or bike rentals, provide free parking or parking passes, set up a bike rack with a pump, or organize a carpooling program.

Say No to Bags

When IKEA set a goal to reduce the usage of plastic bags by 50%, they created reusable bags that customers could purchase for less than $1. They found a way to profit off a policy that saves them money — you could argue they’re double-dipping: eliminating the cost of plastic bags, adding the revenue from selling branded, reusable bags.

Many retailers incentivize the no-plastic-bag concept and offer discounts to customers who bring their own reusable bags.

In 2014, California passed legislation that banned plastic bags at large retailers, as well as imposed a fee for other types of bags at specified locations.

Natural Grocers, a grocery and vitamin store chain committed to going green, has a store policy that they do not provide bags for customers. They only provide recycled cardboard boxes.

If you can’t do away with bags completely, consider charging for them. This will make them less appealing for your customers, encouraging them to bring their own bags. If you’re really committed to the cause, donate the money to an environmental non-profit.

Own Your Green Identity

While benefitting the environment if one of the biggest draws of going green, it can also give a major boost to your brand identity.

Share your green initiatives with the public, and get your customers in on the movement. Consumers care about your products, but they also care about what you stand for, so this is a great way to differentiate yourself and garner support.

How to Save Energy: Moving Forward

Regardless of how extreme you are in your green philosophy, going green can be a huge asset both to the environment and to your bottom line.

How will you cut your energy costs? What methods have worked in the past? Share your tips in the comments below.

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About the Author

Alexandra Sheehan is a freelance writer/editor and content specialist. She’s worked with retailers ranging from Fortune 100 companies to Etsy shop owners, and is always looking for innovative ways to help her clients.